How is box office collection calculated? Know the difference between net, gross and worldwide earnings

How Box Office Collection Calculate: From small budget to big films are released in the theater every day. With this, discussions start taking place between the industry and people regarding box office figures. Words like first day opening, weekend collection, 100 crore club and 500 crore club are heard everywhere. Many people think that whatever money comes from selling tickets goes directly to the filmmaker and the star. But in reality this does not happen. The entire system of earning a film is divided into many parts. This includes the government’s tax, the theatre’s share, the distributor and finally the producer. Therefore, during box office collection, different terms like net collection, gross collection and worldwide collection remain in discussion.

Gross collection is seen first at the box office.

When a viewer goes to the theater and buys a movie ticket, the entire price of the ticket is added to the gross collection. Tax is also included in this. That is, the total amount of money spent by the audience on buying tickets is called the gross collection of the film. For example, if a movie’s tickets have earned Rs 100 crore all over India, then this will be its India gross collection. This also includes the GST received by the government. This is the reason why gross collection is not the real collection of a film. This only tells about ticket sales.

Net collection is important

The amount that remains after deducting government tax from gross collection is called net collection. GST is levied on movie tickets in India. Different taxes are levied according to the ticket price. When this tax is deducted, the money that is left is called net collection. Suppose the gross collection of a film is Rs 100 crore and tax on it is Rs 20 crore. In such a situation, after removing the tax, the net collection of the film will be considered to be Rs 80 crore. In the film industry, net collection is usually used to declare a film as hit, superhit or flop. Because the budget is compared with this figure.

Who gets the net collection income?

Many people think that net collection is the real income of the producer, but this is also not the reality. Let us tell you that a major part of the net collection is divided between the theater owner and the distributor. This is called distributor share. Usually, in the first week, about 50 percent share of the net collection is given to the distributor and the rest is kept by the theater owner. This percentage gradually decreases in the second and third week. That means, if a film has made a net collection of Rs 100 crore, it is not necessary that the producer gets the entire Rs 100 crore. In many cases, the producer or distributor gets only about Rs 45 to 50 crores.

What is Worldwide Collection?

Now Indian films are released not only in India but also in foreign countries. This includes many countries like America, Britain, UAE, Australia and Canada. The amount a film earns outside India is called overseas collection. When the gross collection of India and the gross collection of foreign countries are added, then it is called worldwide gross collection. For example, suppose. If a film makes a gross collection of Rs 200 crore in India and earns Rs 100 crore from abroad, then its worldwide gross collection will be Rs 300 crore.

Also read: Explainer: No-Pregnancy, No-Affair and No-Kissing, what are these special conditions in the contracts of actors?

How do films earn money from different circuits?

India’s box office is divided into many parts. These are called circuits or territories. There are many big circuits like Mumbai, Delhi-UP, Punjab, Bihar, Rajasthan, West Bengal, Madhya Pradesh, Tamil Nadu, Andhra Pradesh and Mysore.
Every circuit has its own distributor, who collects collection data from the theaters there. Later, by adding all these figures, net and gross collection is prepared at the national level. Mumbai circuit is considered the most important for Hindi films, because it earns big money.

What is Corporate Booking and Self Buying?

In the last several years, a new trend related to box office has emerged in the film industry, which is called corporate booking or self buying. In this, the producer, distributor or any company buys a large number of tickets in advance. These tickets are also added to the box office collection. If seen, this money comes through ticket sales, hence it is included in the collection. However, many trade experts believe that the real buzz of the film cannot be known due to this.

Films earn money through many sources other than box office.

In today’s time, films do not earn money only from theatre. Producers make many big agreements even before the film is released. These include OTT rights, satellite rights and music rights. Many big films recover a major part of their budget through these agreements even before release. This is the reason why some films do not remain in loss despite performing average at the box office.

This is how producers earn money

The success of a film cannot be decided just by looking at its worldwide collection. Gross collection represents ticket purchases. Net collection tells the actual earnings after removing taxes. While the worldwide collection shows the global reach of the film. All three figures have to be seen to know the real earnings of any film. However, the most important income for the producer is his share and from OTT, TV and music rights.

Also read: Mirzapur The Movie: There will be chaos again! Poster of ‘Mirzapur’ movie released, update regarding teaser also came